Until now, we have focused exclusively on technology stocks in my TNT Trader newsletter — and we’ve done well, with an average annualized return of 56% if you count our option trades, explains Mark Skousen.
I now see explosive investment opportunities another sector of the global economy — gold and mining stocks! Ever since the coronavirus scare struck the United States (and the global economy), I’ve been super bullish on gold and mining stocks.
Given the Federal Reserve’s easy money policies, pushing interest rates back down to zero and engaging in more quantitative easing (QE), gold could easily go over $2,000 an ounce by next year. In addition, Congress is spending money like there is no tomorrow, which will cause inflation in the future.
(Editor's note: Mark Skousen will be participating in the MoneyShow Virtual Event. On Tuesday, May 12th, Mark will be discussing "Why I Predicted a 'Black Swan' Event in 2020: Five Ways to Survive and Prosper in the New Decade". Register for FREE.)
One of my favorite gold stocks is Kinross Gold Corp. (KGC), the Toronto-based gold/silver mining company with mines located in the United States, Russia, Brazil, Chile, Ghana and Mauritania.
Kinross has a 21% profit margin. Revenues rose 27% in the past year to $3.5 billion. It earned $718 million after taxes and is expected to earn 51 cents a share when it reports in May.
What about the future? Like most companies, it has withdrawn its guidance for 2020, but its outlook is positive. Over the past two months, earnings estimates have risen.
Currently, the company has $1 billion in cash, which is plenty to cover its long-term debt of $2.5 billion. It plans to produce 560,000 ounces of gold this year.
So far, none of its operations have shut down, although the company is complying with all rules regarding social distancing, etc.
Let’s add Kinross Gold Corp. to our TNT Trader portfolio and set a protective stop of $5.50. For those willing to take greater risks, consider buying the KGC August $8 call options, which last traded for only 69 cents and expire on Aug. 21.
